JJB continues club rollout despite profits warning

JJB Sports has warned of a 20 per cent drop in profits, but plans to continue with its health club rollout.

The company blamed ‘unseasonably wet weather’ and strong competition for a drop in sales at its sportswear stores; total turnover for the 29 weeks ended 15 August 2004 was down 2 per cent compared with the same period last year and the company does not now expect to hit forecasted profits of £88m.

The company remains optimistic about its leisure division however and will press ahead with plans to open 14 combined health club and superstore locations in 2005 – two of which will also incorporate soccer centres.

In a statement the company said: “JJB continues to benefit from a strong cash flow which fully finances its further expansion into the very profitable combined health club and superstore concept, whose success continues with total membership of the 19 clubs in operation at 15 August of 77,000.

“The board remains confident that the emphasis being placed upon the expansion of the combined units will have a material and beneficial impact upon JJB’s profits over the coming years.”

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